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Dear Editor,

Having discussed this in the past and considering that this topic has been broached by a couple of other persons in the public domain, I would like to again bring this topic of matter up.

It is the issue of the high-profit tax on our island. What is profit tax or corporate tax?

A corporate tax is a total tax applied to the net profits of a company i.e. gross profits less expenses, depreciation, operation costs, and other costs.

The global average corporate tax rate is 23.64% as per Investopedia.

St. Maarten (Dutch) has a rate of 34.5%. Whilst our neighbouring islands such as Aruba & Curacao have a corporate tax of 22%. In addition, few countries in the Caribbean region such as Anguilla, Bahamas, Bermuda, Turks and Caicos, and the Cayman Islands do not charge a corporation tax at all.

This structure perhaps assists these islands mentioned above in being more appealing to many entrepreneurs and US businesses. Combined with a simple structure for setting up offshore businesses, they have successfully become destinations for this service.

Presently, following a decade of debate, 142 countries recently agreed to the first major overhaul of the international tax system in a century.

With support and under direction from the IMF (International Monetary Fund), multinational companies which have a significant business, but few or no local operations, would not be allowed to allocate profits to countries in absence of physical establishments, thus reducing their dependencies for shell corporations in 0% tax jurisdictions.

The IMF has also suggested a global minimum effective tax rate of 15%, therefore putting pressure on 0% tax jurisdictions and reducing the need for corporations to hold shell companies.

Conversely, a very high corporate tax, like in St. Maarten, encourages profit shifting to lower tax jurisdictions. Considering our island which has a higher percentage of small businesses, a lower profit tax rate will encourage businesses to report profits legitimately.

local people and companies which is essential for socio-economic recovery of Sint Maarten.

Historic Timeline

Princess Juliana Airport was officially opened by Princess Juliana in 1944. In 2006, her Majesty Queen Beatrix inaugurated the new terminal building. In 2017, the airport was hit by Hurricane Irma (Cat 5) In January 2020, Princess Juliana International Airport signed the World Bank/EIB loan to reconstruct the terminal. In July 2021, Ballast Nedam International Project signed the contract to start the reconstruction.

Reducing the profit tax will boost new investments as a larger book profit makes a business eligible to get financing from a bank more easily. It also reduces the need for a business to use more creative accounting thus letting the money stay in the system.

Higher financing and more business expansion leads to wage growth and a higher GDP. It would be worthwhile to see what our island’s profit tax collection stands at 34.5% or in other words how many companies are actually profitable and to what extent?

All in all, we have been immensely stagnant on putting a tax reform into proper action. The positives of reforming our tax system outweigh the negatives we are currently facing. A reduced rate would enable more companies to be included in this ambit of “profitable” companies, which in turn would broaden the base of the collection.

If our neighbouring islands can progress over the years, what is stopping us?

PHILIPSBURG -- Drastic reforms to the Kingdom Charter should be the only relevant topic for the next Inter-Parliamentary Kingdom Consultation (Ipko), Independent Mp Grisha Heyliger-Marten stated in a press release: “There are stacks and stacks of documentation pointing out that the Kingdom Charter does not and cannot work, and is not in compliance with international law.”

During the most recent IPKO-meeting in Curacao, MP Heyliger-Marten expressed her dissatisfaction with the fact that “the discussion about changing the Kingdom Charter seems to be avoided.”

All governments within the kingdom complain about the Charter’s structure and its deficient articles, but nobody seems to want to address the problems, the MP stated.

In Curacao, MP HeyligerMarten attended the IPKO for the fourth time, noting that its participants “keep beating around the bush without making any changes for the betterment of our people, just to keep the fata morgana alive of a so-called functioning kingdom based on equality.”

Heyliger-Marten said that she is tired of this repetitive process. ”It is time for our parliaments to call a spade a spade. We need to make definitive decisions about where we want to go with our respective populations and the kingdom, why and how.”

The MP pointed to the article 73 fact sheet, motions from all parliaments in the kingdom, court proceedings, and reports from the CERD (Committee on the Elimination of Racial Discrimination), saying: “I don’t know what else is needed to substantiate that we cannot continue with these dysfunctional and abusive relationships within an unlawful Kingdom Charter.”

Changing the Charter to something that abides by international law is not complicated, Heyliger-Marten says. “List the articles in the Charter that violate international law and cause complications in the relationship between the kingdom partners and either scrap or amend them. It is really that simple because we know exactly which articles we are talking about.”

The independent MP does not want to stop there and calls for a screening of all current laws within the kingdom to check whether they comply with international law. She intends to send a letter with the relevant request to the chair of

+1-721-523-3564 parliament in Philipsburg, Prime Minister Silveria Jacobs, the Dutch Parliament and First Chamber and the Kingdom Council of Ministers.

Heyliger-Marten furthermore stated that she is pleased with the IPKO’s decision that all parliaments should be involved in the preparation for the kingdom conference and that they should also be represented there. “This is how it should be, since the parliaments are the ones who ultimately have to approve amendments to the Kingdom Charter and any other laws.”

Her focus remains on fundamental changes to the Kingdom Charter. “If we are not willing to do that we might as well stop organizing IPKO’s and dismantle the Kingdom Charter once and for all, instead of continuing to chase an illusion for another 68 years.”